Posts tagged ‘Kaminak Gold Corp (KAM)’

Canada’s largest diamond mine reached a production milestone this week as Diavik passed the 100-million-carat mark. In operation since 2003, the project’s now a 60/40 joint venture of Rio Tinto NYSE:RIO and Dominion Diamond TSX:DDC, with Rio acting as operator. The company lauded “the teams who have helped make this happen safely and responsibly in some of the harshest operating conditions in the world.” The mine sits about 220 kilometres south of the Arctic Circle in the Northwest Territories’ Lac de Gras region.

Despite “some of the harshest operating conditions in the world,” Diavik continues to produce valuable gems.

Rio expects to bring a fourth pipe called A-21 online in H2 2018, spending US$350 million over a four-year period that began in 2014. A-21 would add a proven reserve of 10 million carats, helping extend Diavik’s lifespan to 2023.

The mine employs approximately 1,100 people, half of them living in the north and one-quarter aboriginal. Since 2003, operators have spent C$6.8 billion on goods and services, over 70% with local firms, many of them native-owned.

“Strong and respectful partnerships are at the heart of the way we work at Diavik and I would like to thank all of our investors, our community, business and government partners, and our workforce for their support over the past 13 years,” said Diavik president/COO Marc Cameron.

After De Beers suspended Snap Lake operations last December, the NWT was reduced to just two mines, Diavik and Dominion’s majority-held Ekati. Those two, however, produce enough diamonds to place Canada third in world production by value. Lac de Gras gains “the world’s largest new diamond mine” in H2 this year as Gahcho Kué begins production on a probable reserve totalling 55.5 million carats. A 51%/49% JV of De Beers and Mountain Province Diamonds TSX:MPV, the mine was 94% complete as of last week.

The Diavik discovery followed Chuck Fipke’s 1991 Ekati find, which set off the country’s biggest staking stampede since the Klondike. Matthew Hart’s Diamond: The History of a Cold-Blooded Love Affair recounts Diavik’s dramatic 1994 discovery by Eira Thomas, then a 24-year-old project manager for Dominion-predecessor Aber Resources.

Thomas now serves as president/CEO of Kaminak Gold TSXV:KAM, which last week announced a takeover bid by Goldcorp TSX:G valued at C$520 million.

AME BC’s Gathering Place sees progress among the problems, hope for the future

Over 6,700 participants from 35 countries descended on Vancouver to give Roundup 2015 the fourth-largest crowd in its 32-year history. Promotion, deals and networking thrived, but so did the Association for Mineral Exploration British Columbia’s education and outreach programs. Prominent among them was Gathering Place, a four-day dialogue in which miners, natives and others tackled tough issues as the industry undergoes a cultural transformation.

Tsimshian, Coast Salish, Tlingit and Kwakwaka’wakw dancers take part in a Roundup cultural performance.

Generalities and platitudes flowed freely. But discussion could be candid too. Some company reps outlined specific policies to bring aboriginals into mining and exploration while natives suggested further courses of action. While acknowledging the seemingly slow pace of progress, one CEO maintained, “If you look back 25 years ago and look where we are today, I think you’d probably describe it as a revolution.”

Among the success stories would appear to be Kaminak Gold’s (TSXV:KAM) Coffee project. Now moving towards feasibility, Kaminak reached out to local communities in 2010, soon after optioning the Yukon property and prior to staking additional claims.

“We wanted to know if there were trap lines in the area, we wanted to know if there were any cultural or sensitive areas, or any historical areas that we need to be aware of,” explained Allison Rippin Armstrong, Kaminak’s VP of lands and environment.

Natives alerted the company about nearby gravesites, which Kaminak then excluded from staking. “That early engagement helped us avoid what potentially could have been a very distressing situation,” Armstrong said. The company funded a heritage resource study for reference when planning exploration. Environmental monitoring also began in 2010 with the help—and input—of employees from the Tr’ondëk Hwëch’in first nation (TH). The natives, who’d already signed a land claim agreement, have traditional territory covering Kaminak’s deposit.

The project currently has three TH environmental monitors working with consultants who collect data at the site. The monitors also help “develop and define the baseline programs so they come from a first nation community perspective as opposed to just a purely scientific perspective,” Armstrong emphasized.

As Kaminak president/CEO Eira Thomas told a panel discussion, the company solicits native concerns during its environmental work. By the time Kaminak files a permit application, she hopes those concerns will be addressed.

In another forward-looking precaution, Kaminak provides pre-season work plans to first nations for input and review. An exploration and co-operation agreement signed with TH in 2013 includes a conflict resolution process.

Kaminak has also developed a program of modular training, involving flexible courses that can be scheduled around work and other commitments. The courses don’t require a high school diploma yet could lead to university studies, Armstrong said.

A partnership with Yukon College will bring about two pilot courses this year to prepare TH citizens for skilled jobs. “If and when our mine gets built, the entire environmental department will be TH citizens.”

Fewer specifics came from a panel discussion involving the heads of four companies with mines or advanced-stage projects.

New Gold TSX:NGD president/CEO Robert Gallagher did point out that certain contracts at the company’s New Afton mine in central B.C. are restricted to first nations businesses. Natives make up 23% of the mine’s employees. A plan to team up aspiring aboriginal businesses with experienced joint venture partners, however, failed to transmit skills from one company to the other.

Then New Gold brought in a business development director. “He works with the first nations to develop the skills and put training in place so they can really learn the business,” Gallagher said. As it stands now, the new business still works with a JV partner. But New Gold plans to eventually split the contract between two former partners as the JV ends and a standalone native-owned company emerges.

An aboriginal business owner in the audience urged companies to train natives to adapt to camp life. “If you don’t train them the right way, you’re just wasting money because it’s a Jerry Springer show every night after supper in the rec room.”

Gold news from Kaminak, Columbus and Continental

Over three million inferred gold ounces mark the debut resource estimate from Kaminak Gold’s TSXV:KAM Coffee Project in Yukon’s White Gold District. With its initial resource complete and metallurgical studies continuing, the company’s ready to begin a PEA next year, according to a December 13 announcement.

Two and a half years’ work at Kaminak Gold’s Coffee Project paid off with a maiden resource totalling 3.24 million gold ounces inferred.

Coffee’s base case resource uses a lower cutoff for oxide and transitional mineralization than for sulphide material, on the principle that oxide and transitional mineralization might be extracted through open-pit mining and heap-leach metallurgy. The resource contains 90% oxide and transitional material to a vertical depth of about 200 metres, the company stated, and 55% oxide and transitional to a depth of 100 metres.

The company added that the resource shows “relatively continuous, sub-vertical zones of gold mineralization” with potential for surface-, underground- or a combination of both mining techniques. The resource covers four zones of the Coffee Project.

Using a base case cutoff of 0.5 grams per tonne gold for both oxide and transitional mineralization, and 1 g/t for sulphide mineralization, the inferred resource totals:

Using a 1 g/t cutoff for all types of mineralization, the inferred resource totals:

36.52 million tonnes averaging 2.21 g/t for 2.6 million gold ounces.

Using a 1.5 g/t cutoff, the inferred resource totals:

21.1 million tonnes averaging 2.93 g/t for 1.99 million gold ounces.

In a company statement Kaminak president/CEO Rob Carpenter said, “The drilling strike rate and continuity of the mineralized structures at shallow depths show that our strategy and targeting technique—that is, drilling gold-in-soil anomalies—is highly effective in this geological terrain. Based on the surface footprints of currently known gold-in-soil anomalies, Kaminak geologists see considerable expansion potential along strike from the current resource and elsewhere on the [60,700-hectare] Coffee Project.”

Kaminak has $16 million cash and no debt, the company stated. Its shares closed December 12 at $1.26, opened December 13 at $1.36 and reached a high of $1.47 before closing on $1.29.

In other December 13 news, Columbus Gold TSXV:CGT said a step-out hole at its Paul Isnard Project in French Guiana increases its resource potential. Assays for the hole showed 1.07 g/t gold over 40 metres (with a true width estimated at 75%), stopping at a down-hole depth of 180 metres.

President/CEO Rob Carpenter commented, “Drilling a new, oxide-rich gold zone early in the 2012 season re-affirms the excellent exploration potential of the Coffee Property. Soil chemistry and magnetic patterns suggest the T4 and T5 structures continue towards the Latte zone which occurs one kilometre south of current drilling. Kaminak will rapidly define the extent of these new zones with continued step-out drilling.”

The Supremo Zone soil anomaly comprises at least eight structural zones over an area approximately two kilometres long and two kilometres wide. Drilling has traced the T2 and T3 zones along strike for 350 metres and 700 metres respectively; they are open in all directions. Surface soil geochemistry and newly acquired geophysical data suggest the Supremo structures link with the Latte Zone one kilometre south. This Connector Zone represents a high-priority exploration target for 2012.

The project’s $15-million phase I program includes 40,000 metres of drilling from four drills (three diamond drills and one RC drill), geophysics and the collection of 10,000 new soil samples in previous unexplored regions of the property. Lack of glaciation over the property has made in-situ soil sampling a highly effective exploration tool. All of Kaminak’s gold discoveries to date have been found by drilling directly underneath gold-in-soil anomalies.

The project is located in the White Gold District. Lack of glaciation over the property allows in-situ soil sampling to be used as an effective exploration tool. All of Kaminak’s gold discoveries so far have been found by drilling directly underneath gold-in-soil anomalies. There are over 19 kilometres of untested soil anomalies known on the property that warrant drill testing and only 10% of the property has seen systematic grid soil sampling.

“The Coffee project was acquired by Kaminak in 2009, from a prospector by the name of Shawn Ryan. We own it 100%. In 2010, we executed the first ever drill program on the Coffee Property; prior to our acquiring the property no one had ever put a drill hole into it. Which is extremely important in terms of blue sky potential. This is a brand new discovery in the historical Klondike area.

“[Our] primary exploration tool is soil sampling, and the reason why this tool is effective is because the area has never been glaciated. So when you take a soil sample, it’s a direct representation of the bedrock mineralization below. In most of Canada you take a soil sampling and you have to trace it back to its source—which could be hundreds of kilometres away, sometimes less, sometimes more. That can be a hair-pulling exercise. So we start taking 10,000 or 20,000 soil samples on a property that’s never been glaciated, and you start to see patterns and trends emerge in the gold-in-soil samples. These trends are essentially the gold bearing structures below. All we’re doing is drilling underneath these trends, hitting the structures and intersecting gold. Knowing how to explore property is critical to the success of the property and the efficiency of your drilling. Last year we had a 100% success rate as far as drilling underneath soil and finding gold. So we’re confident that the soil sampling is working. It gives us a good indication of the footprint, of the potential of the property, because the more gold-in-soil trends you see, the higher the potential for more gold-bearing structures.

The area has never been glaciated. So when you take a soil sample, it’s a direct representation of the bedrock mineralization below. – Tony Reda

“What today’s news release shows is that we found gold outside of the soil footprint. Initially we were just drilling our best soil anomalies. But we hit some of our best intercepts outside of the gold-in-soil footprint. So sometimes these targets are hidden. The Latte Zone soil footprint is one kilometre long, and now we’ve hit outside of that. This gives us a greater indication that the footprint is not the only indication. Not only is there the structure we see in the ground mag, but also the fact that we’re hitting on these holes outside of the footprint, extending the strike length of that zone.

“We don’t have a resource estimate right now, because last year was the first year of drilling. Typically, resource estimates take multiple years and a lot of drill holes. So it’s hard to speculate on when you’ll have a resource, because that really depends on the mineralization, and you don’t know if the next hundred holes are going to hit. But we are working towards that resource, and if everything hangs together and, assuming that we continue to hit and there’s continuity of mineralization and someone’s willing to sign-off on it, then we could potentially have a resource by the Q1 of next year.

“Our Phase 1, $15-million drill program involves 40,000 metres of drilling. That kicked off April 19. So we’re only a couple of months into it. We are about to kick off soil sampling, and we’ve done some geophysics on the property already. Four drills are turning. They are at three zones: Double Double, Latte, and Supremo. Probably at the end of June, some of those drills will move to other targets. Perhaps new drills will be brought on. Then we’ll go from there.

“We’re not a mining team, we’re an exploration team. At the end of the day it’s about doing what’s best for your shareholders and creating value. So if that means taking this to production, we’ll obviously consider that option. But right now, we are well-equipped to take this to feasibility level. If we were to take this to the next level, we’d have to bring on a mining team. The company itself could do that, but right now it’s a matter of keeping your stick on the ice, finding gold and staying focused on that task.

“We’re exceptionally pleased with this project. It’s spectacular. Most companies go their whole lifetime trying to make one discovery. We have eight, and we’re very pleased with the results thus far.”